National Retail Properties : 2020 Interactive Annual Report

ANNUAL REPORT 2020

Dividend yield at December 31, 2020 of 5.1%

Maintained high occupancy at 98.5%

Invested $180.0 million in property investments	Sold 38 properties for
@ average 6.5% cap rate (initial cash yield)	$54.5 million

Maintained dividend payout ratio	Maintained significant balance sheet
of approximately 82.6% of AFFO	capacity and liquidity

Ended 2020 with $267.2 million of cash, no amounts drawn on $900 million bank line and no near-term debt maturities

TRIPLE NET LEASE

A net lease requires the tenant to directly pay many of the costs associated with a property. Our properties are typically leased on a TRIPLE NET LEASE basis, meaning the tenant pays for the real estate TAXES, MAINTENANCE, INSURANCE and utilities at the property level. We believe strongly that triple net leases provide increased stability to our rental revenue over the long term; we are insulated against increases in these property operating costs and our rental income goes directly to the bottom line. The real estate industry moniker for triple net leases is "NNN," which has been the basis for our New York Stock Exchange ticker symbol since 1994.

TABLE OF CONTENTS

3 | LETTER TO SHAREHOLDERS

10 | COVID-19 UPDATE

16 | CORPORATE RESPONSIBILITY INSIDE BACK COVER OUR OFFICERS AND DIRECTORS

SHAREHOLDER INFORMATION

31 CONSECUTIVE ANNUAL DIVIDEND INCREASES

Third longest streak of all public REITS and longer than 99% of all public companies

$2.10 $2.00 $1.90 $1.80 $1.70 $1.60 $1.50 $1.40 $1.30 $1.20

$1.10

$1.00

'90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20

CONSERVATIVE BALANCE SHEET MANAGEMENT

As of December 31, 2020 - based on total gross book assets

61.7%	Common Equity	Unsecured Debt
|	$ 5 298.9	Million	34.2%	|	$ 2 942.3	Million
		,		,
	Preferred Equity	Not Shown: Secured Debt
4.0%	|	$345.0 Million	0.1% |		$11.4 Million

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• ANNUAL REPORT 2020

MY FELLOW SHAREHOLDERS,

In a year that no one could have predicted, National Retail Properties benefited from its consistent long-term strategy,

its experienced and talented associates, and its conservative, low leverage balance sheet philosophy. Our mission to create long-term shareholder value has been and remains to:

1	2	3
Consistently grow	Increase the annual	Conservatively
Core FFO per share over a	dividend while prudently	manage the
multi-year timeframe	managing the pay-out ratio	balance sheet

By adhering to this mission for decades, we built a business that withstood a once-in-a-hundred-year pandemic with minimal long-term impact.

Our consistent strategy provided us with the perspective and ability to, among other things: (i) continue to pay, and even increase, our common stock dividend, (ii) structure collaborative rent deferral agreements with our relationship tenants, allowing our customers time to sort out the issues in their own business operations that were affected by the pandemic,

1. take a pause in our acquisition efforts until we had better clarity on real estate values and tenant business performance,
2. establish a flexible work environment for our associates that promoted retention, collaboration and continued career development, and (v) wait patiently for the disruption in our stock price to subside before issuing any equity.

HIGHLIGHTS OF 2020

Before delving into the details of this past year, I want to offer my deepest appreciation to all of the associates at National Retail Properties for their hard work, perseverance, flexibility, collegiality, professionalism, and dedication in 2020. I could not be prouder of this talented team.

Although our long-standing track record of consistent per share growth was disrupted in 2020 due to the pandemic, these highlights demonstrate our positioning to return to our strategy to create long-term shareholder value in 2021 and beyond. Highlights for 2020 include:

Increasing the common stock dividend for the 31st consecutive year, a feat matched by only two other REITs and by less than 1% of all US public companies.

Raising $700 million of well-priced debt capital early in the year, which put us in a strong liquidity position as the pandemic began to spread, and enabled us to end 2020 with $267 million of cash in the bank and nothing drawn on our $900 million line of credit.

Reaching collaborative rent deferral agreements during the early stages of the pandemic with a number of our long-standing tenants, which solidified our relationships and set us up for future acquisition business with these appreciative tenants.

Steadily improving rent collections after the initial impact of the pandemic, ending the year with fourth quarter rent collections of 95.7%. For the year, we collected approximately 90% of the annual base rent due in 2020, with almost all of the balance being deferred (not forgiven) and scheduled for repayment over the following 18 months. This is a very strong showing compared to other retail real estate companies.

Supporting our associates and our community with programs and activities to advance associate well-being, employee engagement and community involvement; and,

Enhancing our executive leadership team with the appointment of Steve Horn, a 17-year veteran with the company, as our Chief Operating Officer.

In short, we remained consistent in our long-term perspective and business plan.

3 ANNUAL REPORT 2020

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